NEW YORK, Jan 15, 2009 (BUSINESS WIRE) -- Retailer Saks Incorporated (NYSE: SKS) (the "Company") today announced a
series of actions related to expenses, capital spending, and inventory
receipts being implemented in response to the deteriorating economic
environment and to better position the Company for the future.

Steve Sadove, Chairman and Chief Executive Officer of Saks Incorporated,
noted, "Our financial performance is increasingly being challenged by
some of the most difficult economic conditions our Company has faced in
its 84-year history. It is our expectation that the economic environment
will remain extremely challenging through 2009, if not beyond. The
sustained downturn in the economy and the decline in luxury consumer
demand necessitates that we take appropriate and decisive measures to
position the Company for this new operating environment. The cost and
capital expenditure reductions are structured to minimize the impact on
our customers, and the reduction in inventory receipts is reflective of
the decrease in consumer demand. Each of our actions will benefit 2009
and should better position the Company for the future, when economic
conditions improve. We continue, however, to focus on and make targeted
investments in our strategic merchandising, marketing, and selling
initiatives."

A significant component of the cost reductions consists of a
reduction-in-force and changes to compensation and employee benefit
plans. Specifically, these actions include:

reductions of approximately 1,100 corporate support and store
positions, equating to approximately 9% of the total Company workforce
(in addition to the previously announced reduction-in-force related to
discontinuation of the Club Libby Lu business),

elimination of 2009 merit-based wage increases for the entire
workforce,

suspension of 401(k) Plan Company matching contributions for a minimum
of one year, and

suspension of future benefit accruals for the limited number of
associates remaining in the Company's pension plan.

The majority of affected associates will be notified shortly, and most
position eliminations will be effective by January 30, 2009. Eligible
associates will be offered appropriate severance packages. Changes in
the benefit plans mentioned above will in general be effective for the
2009 plan year. The Company will incur cash severance charges of
approximately $9 million, principally in the fourth quarter ended
January 31, 2009 (in addition to the previously announced charges
related to the discontinuation of the Club Libby Lu business).

The Company also has identified additional non-employee based cost
reductions, primarily in the areas of procurement, information
technology, distribution and logistics, travel, and marketing.

The 2009 cost reductions and eliminations are expected to total between
$50 million and $60 million and will be reflected in cost of sales
(where merchandising and distribution expenses are classified) and in
Selling, General, and Administrative ("SG&A") expenses. Reductions in
SG&A expenses are expected to more than offset 2009 increases in pension
expense, normalized incentive compensation, and certain inflation-driven
expenses.

In addition to cost reductions, the Company has lowered its planned
capital expenditures for fiscal 2009 to approximately $60 million, a
decrease of over 50% from the projected 2008 level. The 2009 capital
expenditures primarily will be related to the completion of the women's
designer floor in the New York City flagship store and certain
renovation projects underway in other stores, as well as investments in
routine store maintenance and corporate infrastructure projects. The
Company also has targeted an approximate 20% decrease in inventory
receipts for 2009.

"Based on the expectation for continued weakness in consumer demand
during 2009, we also are fortunate to have flexibility under our
existing debt facilities, with no short-term maturities of senior debt,"
Sadove added. The Company's revolving credit facility does not terminate
until September 2011, and it is subject to no financial covenants except
as to the last $60 million of availability. The Company's remaining
senior notes total $192.3 million and mature as follows: $45.9 million
in December 2010, $141.6 million in October 2011, $2.9 million in
December 2013, and $1.9 million in February 2019. The Company also has a
2% $230 million convertible debenture which matures in 2024.

Sadove concluded, "We have an exceptional brand, valuable and
unencumbered real estate, a loyal customer base, solid vendor
relationships, and an outstanding team. Although we are staying the
course with our long-term strategies, we are making prudent adjustments
to our organization and our operations that are needed in this
environment. We are positioning the Company to be an even stronger
organization when the economy improves."

The Company will announce its results for the fourth quarter and fiscal
year ending January 31, 2009 on Wednesday, March 4, 2009 before market
open and will host a call for the investment community at 10:00 a.m. ET
that day. Management will provide additional information about its
outlook for 2009 at that time. The dial-in number for the call is
706-643-1966.

The information contained in this press release that addresses future
results or expectations is considered "forward-looking" information
within the definition of the Federal securities laws.Forward-lookinginformation in this document can be identified through the use of
words such as "may," "will," "intend,""plan," "project,"
"expect," "anticipate," "should," "would," "believe," "estimate,"
"contemplate," "possible," and "point." The forward-looking information
is premised on many factors, some of which are outlined below.Actual
consolidated results might differ materially from projected
forward-looking information if there are any material changes in
management's assumptions.

The forward-looking information and statements are or may be based on
a series of projections and estimates and involve risks and
uncertainties.These risks and uncertainties include such factors
as: thelevel of consumer spending for apparel and other
merchandise carried by the Company and its ability torespond
quickly to consumer trends; adequate and stable sources of merchandise;
the competitive pricing environment within the retail sector; the
effectiveness of planned advertising, marketing, and promotionalcampaigns;
favorable customer response to relationship marketing efforts of
proprietary credit cardloyalty programs; appropriate inventory
management; effective expense control; successful operation ofthe
Company's proprietary credit card strategic alliance with HSBC Bank
Nevada, N.A.; geo-political risks; changes in interest rates; and
fluctuations in foreign currency and exchange rates.For
additional information regarding these and other risk factors, please
refer to the Company's filings with the SEC, including its Annual Report
on Form 10-K for the fiscal year ended February 2, 2008, its Quarterly
Reports on Form 10-Q, and its Current Reports on Form 8-K, which may be
accessed via EDGAR through the Internet at www.sec.gov.

Management undertakes no obligation to correct or update any
forward-looking statements, whether as a result of new information,
future events, or otherwise.Persons are advised, however, to
consult any further disclosures management makes on related subjects in
its reports filed with the SEC and in its press releases.